Sin­ga­pore cuts 2015 growth fore­cast to 2%

SIN­GA­PORE: Sin­ga­pore low­ered its growth fore­cast for 2015 be­cause of weak­ness in man­u­fac­tur­ing and said gains will con­tinue to be mod­est next year even as the global econ­omy im­proves.

The Min­istry of Trade and In­dus­try yes­ter­day fore­cast eco­nomic growth in 2015 at “close to 2 per­cent” and be­tween 1 and 3 per­cent in 2016. It pre­vi­ously fore­cast 2015 growth at be­tween 2 and 2.5 per­cent.

Sin­ga­pore, a city-state at the tip of penin­sula Malaysia, is the wealth­i­est econ­omy in South­east Asia but has shifted to lower growth rates in the past decade as other coun­tries in­clud­ing China eroded its tra­di­tional strengths in elec­tron­ics and other man­u­fac­tur­ing. It has en­cour­aged in­vest­ment in higher value in­dus­tries such as phar­ma­ceu­ti­cals and also tried to boost ser­vices by open­ing two casi­nos, en­cour­ag­ing tourism and be­com­ing a cen­ter for pri­vate bank­ing. The min­istry said global growth is ex­pected to im­prove next year but Sin­ga­pore and other coun­tries in South­east Asia may not see “sig­nif­i­cant up­lift” in de­mand for their ex­ports.

China’s eco­nomic slow­down has dimmed its ap­petite for im­ports, growth in the US is driven by ser­vice in­dus­tries, and both China and the US are tend­ing to rely more on do­mes­tic man­u­fac­tur­ers, it said.

“Against this back­drop, the growth out­look for the Sin­ga­pore econ­omy in 2016 is mod­est,” the report said. Sin­ga­pore’s econ­omy grew 1.9 per­cent from a year ear­lier in the third quar­ter, marginally lower than the 2 per­cent growth in the previous quar­ter, the min­istry said. “Given the cur­rent sub­dued de­mand, and the fact that the In­ter­na­tional Mone­tary Fund and World Bank have both low­ered fore­casts, it isn’t a sur­prise that Sin­ga­pore has fol­lowed suit,” said Song Seng Wun, an econ­o­mist at CIMB Pri­vate Bank­ing.

SIN­GA­PORE: A boat pack with tourists passes through the Cave­nagh bridge next to the fi­nan­cial district in Sin­ga­pore yes­ter­day. Sin­ga­pore’s eco­nomic growth will dip to “close to 2.0 per­cent” this year af­ter the city-state avoided a tech­ni­cal re­ces­sion, the govern­ment said Novem­ber 25, with a po­ten­tial fur­ther slow­down seen in 2016.